If a perfectly competitive firm is producing at a rate output where marginal cost exceeds price...
If a perfectly competitive firm is producing at a rate output where marginal cost exceeds price how can a firm increase its profit?
Homework Answers
The profits are maximized where the marginal costs equal to the marginal revenue. In the perfect competition the price is also equals to the marginal and average revenue so here the marginal cost exceeds the marginal revenue. So this means that the firm is producing too much , in order to maximize the profits the firm should cut down the production until the marginal cost and the marginal revenue becomes equal.
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If a perfectly competitive firm is producing at a rate output
where marginal cost exceeds price...
If a perfectly competitive firm is producing where price is equal to $20, marginal cost is...
If a perfectly competitive firm is producing where price is equal to $20, marginal cost is equal to $25, and average variable cost is equal to $15, what should the firm do, if anything, to maximize its profit? O A. increase output O B. shut down O C. decrease output (but not shut down) OD. The firm is already maximizing profit.
If a perfectly competitive firm is producing at the P MC output and realizing an economic...
If a perfectly competitive firm is producing at the P MC output and realizing an economic profit, at that output Multiple Choice marginal revenue is less than price. marginal revenue exceeds ATC ATC is being minimized total revenue equals total cost
QUESTION 7 For a perfectly competitive firm, at profit maximization market price exceeds marginal cost. total...
QUESTION 7 For a perfectly competitive firm, at profit maximization market price exceeds marginal cost. total revenue is maximized. marginal revenue equals marginal cost. O production must occur where average cost is minimized.
What happens if a competitive firm is currently producing a level of output at which marginal...
What happens if a competitive firm is currently producing a level of output at which marginal revenue exceeds marginal cost? Select one: O a. A one-unit decrease in output will increase the firm's profit. b. A one-unit increase in output will increase the firm's profit. O c. Total revenue exceeds total cost. d. Total cost exceeds total revenue.
. The equilibrium price in a perfectly competitive market is $75. The marginal cost function is...
. The equilibrium price in a perfectly competitive market is $75. The marginal cost function is given By MC= 4+0.2Q What is the profit maximization rule? The firm is presently producing 40 units of output per period. To maximize profit, should the output rate be increased or decreased? Where is profit maximization show your calculations. Explain
A firm in a perfectly competitive industry is currently producing 150 units of output at a...
A firm in a perfectly competitive industry is currently producing 150 units of output at a price of $55 per unit. If marginal cost is equal to $50 and profit is equal to $500 at that level of output, what should the firm do, if anything, to maximize profit?
Question 15 For a perfectly competitive firm, price is less than marginal revenue at all output...
Question 15 For a perfectly competitive firm, price is less than marginal revenue at all output levels price exceeds marginal revenue at all output levels price is less than marginal revenue only at the profit-maximizing quantity price equals marginal revenue only at the profit-maximizing quantity price equals marginal revenue at all output levels
If a perfectly competitive firm's marginal revenue is greater than its marginal cost, the firm O...
If a perfectly competitive firm's marginal revenue is greater than its marginal cost, the firm O A. must be making an economic profit O B. will increase its output to increase economic profit. O c. will decrease its output to increase economic profit. OD. cannot increase its economic profit O E. will lower the price.
4. A firm will begin to experience diminishing returns at the output where marginal A. cost...
4. A firm will begin to experience diminishing returns at the output where marginal A. cost increases B. cost decreases. C. product increases. D. both B and C 5. Marginal cost is average variable cost when A. equal to; average total cost is minimized B. less than; total cost is maximized C. greater than; average fixed cost is minimized D. equal to; average variable cost is minimized. 6. Assume Dell Computer Company operates in a perfectly competitive market producing 5,000...
Consider the following total cost schedule for a perfectly competitive firm producing ball-point pens. Suppose the...
Consider the following total cost schedule for a perfectly competitive firm producing ball-point pens. Suppose the prevailing market price for this firm's product is $0.14 and the firm is currently producing 20 units of output. This competitive firm wishing to maximize its profit would Output per period TVC (S) TFC (S) 0 0 10 25 20 30 6 5 40 10 5 50 15 3. Increase output because marginal revenue is greater than marginal cost b. produce zero output because...
If a perfectly competitive firm is producing where price is equal to $20, marginal cost is equal to $25, and average variable cost is equal to $15, what should the firm do, if anything, to maximize its profit? O A. increase output O B. shut down O C. decrease output (but not shut down) OD. The firm is already maximizing profit.
If a perfectly competitive firm is producing at the P MC output and realizing an economic profit, at that output Multiple Choice marginal revenue is less than price. marginal revenue exceeds ATC ATC is being minimized total revenue equals total cost
QUESTION 7 For a perfectly competitive firm, at profit maximization market price exceeds marginal cost. total revenue is maximized. marginal revenue equals marginal cost. O production must occur where average cost is minimized.
What happens if a competitive firm is currently producing a level of output at which marginal revenue exceeds marginal cost? Select one: O a. A one-unit decrease in output will increase the firm's profit. b. A one-unit increase in output will increase the firm's profit. O c. Total revenue exceeds total cost. d. Total cost exceeds total revenue.
Question 15 For a perfectly competitive firm, price is less than marginal revenue at all output levels price exceeds marginal revenue at all output levels price is less than marginal revenue only at the profit-maximizing quantity price equals marginal revenue only at the profit-maximizing quantity price equals marginal revenue at all output levels
If a perfectly competitive firm's marginal revenue is greater than its marginal cost, the firm O A. must be making an economic profit O B. will increase its output to increase economic profit. O c. will decrease its output to increase economic profit. OD. cannot increase its economic profit O E. will lower the price.
4. A firm will begin to experience diminishing returns at the output where marginal A. cost increases B. cost decreases. C. product increases. D. both B and C 5. Marginal cost is average variable cost when A. equal to; average total cost is minimized B. less than; total cost is maximized C. greater than; average fixed cost is minimized D. equal to; average variable cost is minimized. 6. Assume Dell Computer Company operates in a perfectly competitive market producing 5,000...
Consider the following total cost schedule for a perfectly competitive firm producing ball-point pens. Suppose the prevailing market price for this firm's product is $0.14 and the firm is currently producing 20 units of output. This competitive firm wishing to maximize its profit would Output per period TVC (S) TFC (S) 0 0 10 25 20 30 6 5 40 10 5 50 15 3. Increase output because marginal revenue is greater than marginal cost b. produce zero output because...
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